气候变化领域集成服务门户(CCPortal): Don't stop me now: Incremental capacity growth under subsidy termination risk

CCPortal

DOI	10.1016/j.enpol.2022.113309
	Don't stop me now: Incremental capacity growth under subsidy termination risk
	Nagy, Roel L. G.; Fleten, Stein-Erik; Sendstad, Lars H.
发表日期	2023
ISSN	0301-4215
EISSN	1873-6777
卷号	172 页码:18
英文摘要	Once a subsidy scheme is close to reaching its goal or loses political support, it may be terminated. An important question for policy makers is how to minimize the negative impact of the risk of subsidy termination on industrial investment. We assume the social planner aims to increase capacity and welfare and uses a subsidy, which has an uncertain lifetime, for the purpose. We examine a monopolist supplying an uncertain demand, faced with the option to expand capacity by irreversibly investing in small increments. We find that the firm installs capacity expansions sooner and, consequently, installs a larger capacity than a firm without a subsidy. A firm's total investment during the subsidy's lifetime increases with both the subsidy size and the likelihood of subsidy withdrawal. However, this happens at the cost of less investment directly after the subsidy has been retracted. The optimal subsidy size strongly depends on the point in time at which the social planner aims to maximize the welfare - the further into the future, the larger the welfare optimal subsidy. Furthermore, the welfare optimal subsidy size strongly depends on the social planner's discretion over adjustments to the subsidy size.
英文关键词	Investments; Capacity expansion; Incremental investment; Policy uncertainty; Real options
学科领域	Economics; Energy & Fuels; Environmental Sciences; Environmental Studies
语种	英语
WOS研究方向	Business & Economics ; Energy & Fuels ; Environmental Sciences & Ecology
WOS记录号	WOS:000909515300011
来源期刊	ENERGY POLICY
文献类型	期刊论文
条目标识符	http://gcip.llas.ac.cn/handle/2XKMVOVA/272023
作者单位	Norwegian University of Science & Technology (NTNU)
推荐引用方式 GB/T 7714	Nagy, Roel L. G.,Fleten, Stein-Erik,Sendstad, Lars H.. Don't stop me now: Incremental capacity growth under subsidy termination risk[J],2023,172:18.
APA	Nagy, Roel L. G.,Fleten, Stein-Erik,&Sendstad, Lars H..(2023).Don't stop me now: Incremental capacity growth under subsidy termination risk.ENERGY POLICY,172,18.
MLA	Nagy, Roel L. G.,et al."Don't stop me now: Incremental capacity growth under subsidy termination risk".ENERGY POLICY 172(2023):18.